The structural budget deficit as an instrument of fiscal policy

The article describes how the structural budget deficit is or has been applied as an instrument of fiscal policy in the United States (the Full or High Employment Budget), the Netherlands (the Structural Budget Norm) and West Germany (the Cyclically Corrected Budget). The structural budget deficit is used as a guideline for fiscal policy (normative) and/or as an index in formulating a summary number to measure the cyclical influence of the budget (analytical). In the article only the first use is supported. Furthermore, it is shown that the structural deficit in the Netherlands is not only the highest one, but also shows the biggest departure from its normative value